MEIHUA BIO、MeiHua Group(600873)2024-10-23 01:03Investment Rating - The report maintains an "Outperform" rating for Meihua Holdings Group [1][3][9] Core Views - The recurring net profit for the first three quarters of 2024 decreased by 15.70% year-on-year, with operating revenue down 8.99% year-on-year [2][5] - The decline in performance is attributed to falling market prices for key products such as monosodium glutamate, xanthan gum, and starch by-products, which outpaced the decrease in raw material prices, leading to reduced gross profit margins [2][5] - Prices for threonine and lysine have been rising, with significant increases in spreads compared to previous quarters, indicating potential for improved margins in these segments [6][8] - The company is actively repurchasing shares, with plans to buy back between 25 million to 41.67 million shares, representing 0.88% to 1.46% of total share capital [7][9] Financial Summary - For 2024, the expected net profit is projected at RMB 3.026 billion, a decrease of 14.28% from the previous year, with further projections of RMB 3.456 billion and RMB 3.867 billion for 2025 and 2026 respectively [4][9] - Revenue forecasts for 2024 to 2026 are RMB 28.561 billion, RMB 30.474 billion, and RMB 32.581 billion, reflecting a growth rate of 3% to 7% [4][9] - The gross profit margin is expected to decline from 19.7% in 2023 to 18.1% in 2024, with a gradual recovery to 19.2% by 2026 [4][9] Industry Position - Meihua Holdings Group is recognized as a global leader in the large-scale production of amino acids through synthetic biology technology, with a strong foundation in fermentation technology and significant production capacity [3][8] - The company is focused on enhancing operational efficiency through increased investment in organizational development, technology research, and standardization of business processes [3][8]